Clinton pushes tax break

June 14, 1996

President Bill Clinton has placed higher education firmly on to the election agenda in the United States with his proposal for a tax break that would effectively provide two years of free or cut-price college education.

Citing figures showing that two years of college on average increase lifetime earnings by $250,000, Mr Clinton outlined an offer of $1,500 in an annual "refundable tax credit" - effectively a cash payment for deserving students.

Rising college costs have been identified as a painful issue for families, particularly among the financially squeezed middle-class swing voters who Mr Clinton is courting in the November elections.

Speaker Newt Gingrich immediately denounced the measure as an election ploy. But experts said it could boost stagnant enrolment figures at community colleges, where the credit would cover fees that are typically less than $1,500 a year.

"We look favourably on it," said David Merkowitz, a spokesman for the American Council on Higher Education, though he cautioned that "realistically everybody knows this is not a proposal that is going anywhere this year" because of election politics.

The tax credit would automatically be available to students in their first year of college, and repeated in their second providing they scored a B grade or higher. But Mr Clinton's earlier proposals for tax deductions have gone nowhere in the Republican Congress.

"Our goal must be nothing less than to make the 13th and 14th years of education as universal to all Americans as the first 12," Mr Clinton said in his commencement speech at Princeton University, ironically a traditional bastion of wealth and privilege that celebrates its 250th anniversary this year.

The so-called "Hope Scholarships" are based on a Georgia state programme, Helping Outstanding Pupils Educationally, that is claimed to have doubled local community college enrolment. It is financed by a state lottery and, while pushed by a Democrat governor, over four years it has proved popular even with Republicans.

Funding for Mr Clinton's proposals, with a combined cost of nearly $50 billion, is expected to prove a major headache.

Of the 164.5 million Americans over 25, over half have no college education. A growing number of those without are falling close to the poverty line.

Community college enrolment had been hit by rising fees over the past decade, particularly among minority students.

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